Editor’s note: This story was updated to correct the last year the county received no income from the arena and the split of income between the county and SMG.
Sedgwick County won’t get any income this year from the county-owned Intrust Bank Arena, county staff reported Wednesday.
The arena’s net income for 2014 came in at $122,853, all of which will go to SMG, the company that operates the facility under contract with the county, Assistant County Manager Ron Holt said Wednesday.
SMG general manager A.J. Boleski “won’t be here in April presenting us with a check,” Holt told the County Commission in his quarterly report on arena operations.
The arena needs to make at least $450,000 net profit a year before the county receives any revenue from operations, under the contract in force last year, Holt said.
The arena hosted 100 events in 2014, 20 more than it did in 2013, Holt said. But more of the events were family shows where the arena doesn’t make money from selling alcoholic beverages, one of the most profitable parts of the operation.
The 17 performances by family shows generated only about $60,000 in food and beverage income, less than one-tenth of the $685,000 in food and drinks sold at 13 arena concerts, records show.
“The point is, the mix of events and types of events makes a difference in how the arena performs financially,” Holt said.
Some commissioners said they’re concerned about the lack of revenue to the county, both now and going forward under a new contract.
The first five-year contract gave SMG the first $450,000 a year of any arena profit; the county the second $450,000. Anything more than that was to be split: 60 percent to the county and 40 percent to SMG.
The new pact, which was signed in November and runs for six years, gives SMG the first $400,000, with the company and county splitting anything beyond that 50-50.
Commission Chairman Richard Ranzau voted against the new pact and called it “a big mistake.”
Commissioner Jim Howell, elected to the board after the contract was approved, said he was concerned that “we don’t have any control over how it’s managed.”
He said he would like to eventually turn arena oversight over to the city of Wichita because the facility is in the city’s downtown area.
Commissioner David Unruh said it would be nice if the county got some revenue from the arena. But regardless, he said, it’s still helping the community.
He pointed to a section of the report showing the arena paid $2.5 million in wages to local residents and spent another $2.5 million with Kansas companies. In addition, community groups that volunteer to run concessions at the arena earned $305,000 for their organizations and about 70 charity groups got free tickets or other in-kind donations from the arena.
It’s the second time in the arena’s five-year history that profits weren’t large enough for the county to get a share. The last time that happened was 2012, when revenue from 2011 came up short of the contract threshold, Holt said.
Last year, the county received about $253,000 income off an overall profit of $705,000 from shows in 2013, records show.
Reach Dion Lefler at 316-268-6527 or firstname.lastname@example.org.